A STUDY ON THE

FLOWER SELLERS OF
CHOOLAIMEDU
AN EXPLORATORY NARRATIVE REPORT
Aruna V N
PGPBA
IGTC CHENNAI

A BRIEF STUDY ON THE FINANCIAL AND BUSINESS ASPECTS OF FLOWER SELLERS

AND TO UNDERSTAND HOW MICRO FINANCE CAN PLAY A ROLE IN THEIR LIVES
A study on the flower sellers of Choolaimedu Aruna V N, IGTC Chennai

TABLE OF CONTENTS

1. Introduction:...........................................................................................................................5
2. Objective:...............................................................................................................................5
3. The flower sellers of Choolaimedu:.......................................................................................5
4. Limitations of the study:........................................................................................................6
5. Case studies............................................................................................................................6
5.1. Vasantha:.........................................................................................................................6
5.2 Kannama.S:......................................................................................................................7
5.3 Sivabaghyam:...................................................................................................................8
5.4 Lakshmi:...........................................................................................................................9
5.5 K.Rani:.............................................................................................................................9
5.6 Uma:...............................................................................................................................10
5.7 Sakkarai:.........................................................................................................................11
5.8 Veeramma.M..................................................................................................................11
5.9 Indira:.............................................................................................................................12
5.10 Anjalai:.........................................................................................................................13
5.11 Gowri:...........................................................................................................................13
5.12 Aarumugam Ammal:....................................................................................................14
5.13 Vasantha:......................................................................................................................15
5.14 Kuppamma:..................................................................................................................15
5.15 Shanthi:.........................................................................................................................16
5.16 Lakshmi: ......................................................................................................................16
5.17 Leelavathy:..................................................................................................................17
5.18 Tamizhchelvi:...............................................................................................................17
5.19 Panjaksharam:..............................................................................................................18
5.20 Kannatha:.....................................................................................................................18
6. Business model of flower sellers:.........................................................................................20
7. Other insights and inputs:.....................................................................................................20
7.1 Vishwanathan:................................................................................................................20
7.2 Rebecca:.........................................................................................................................21

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7.3 Matt Duncan:..................................................................................................................21

8. Money matters:.....................................................................................................................22
8.1.1 A simple income statement of the flower sellers:.......................................................22
8.1.2 Money lenders Vs MFI...............................................................................................23
9. Observations:........................................................................................................................24
9.1 Demographic aspects:....................................................................................................24
9.2 Business aspect:..............................................................................................................25
9.3 Financial aspect:.............................................................................................................26
10. Scope for further study.......................................................................................................27
Appendix 1:..............................................................................................................................28
Appendix 2:..............................................................................................................................29

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A study on the flower sellers of Choolaimedu Aruna V N, IGTC Chennai

Abstract

This report aims at understanding how flower sellers manage their business and the modes
and terms of credit preferred by them to sustain their business and the livelihood.

For this study, the area covered was the entire stretch of Shanmuganar Salai and the
Choolaimedu High road over a period of 2 days (21st and 22nd of October 2010). 20 flower
sellers were interviewed –mainly about their background and their business. Focus was on
how they manage their finances.

Also included in this report are insights from 3 others who are a part of the world of micro
finance – Mr Matt Duncan of the Grameen foundation, Ms Rebecca, centre leader of Equitas
in Choolaimedu and Mr Viswanathan, a local money lender.

The report is an exploratory narrative research and is qualitative in nature.

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1. Introduction:
The two things that an average Indian buys on an everyday basis are vegetables and flowers.
Not bouquets or fancy bunches of flowers but long strings of fragrant flowers. Flowers are
an integral part of our daily lives, especially to Hindus who consider them as a superior form
of offering to God.

It was an anathema for the Tamilians, even 40 years ago, if the unmarried and married
women did not wear flowers in their hair. Now, even if they don’t adorn their hair with
flowers, the Indians make sure that they adorn the pictures of their Gods with flowers.
Flowers here not only symbolises love, but also worship and respect.

Every household interacts with a flower seller on a daily basis and this proximity is the key
inspiration to conduct an exploratory study on the way of life of these people. In a city that
boasts of dozens of flower sellers in every major street, their sheer number and their nature of
their business is apt for an exploratory study on micro finance.

How do these flower sellers run their shop? What made them get into this business? How do
they manage their finances? What kind of a role can MFIs play in the lives of these women?
These are some of the questions for which this study seeks an answer.

2. Objective:
To conduct an exploratory narrative research on the flower sellers of Choolaimedu to
understand about

• Their demographic background

• Nature of business

• Financial aspects of their life and business

The sampling method used for this study is snowball sampling.

3. The flower sellers of Choolaimedu:

Of the 20 flower sellers that the researcher had interacted with, 19 of them are illiterate with
only one woman who has studied till 8th standard. The flower sellers buy flowers in bulk from
either the Koyambedu flower market or the Parrys market. (17 of the 20 buy from
Koyambedu and the rest from Parrys). They buy flowers every day, early in the morning.
Typically, the sell flowers for 4 hours in the morning and 4 hours in the evening.

Apart from buying flowers, the other expenses that they incur for the business include travel
fare, which ranges anywhere between Rs 30 to Rs 40 per day, depending on whether they

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take the share auto, deluxe bus or the regular low fare bus. At Rs 10 per bundle, the flower
sellers spend Rs 20 per day for the thread in which they tie the flowers.

Another important aspect of the business is the concept of delivering flowers to the houses of
some regular customers. 12 of the 20 flower sellers do flower delivery to houses and they
collect money from the customers at the end of the month. On an average, this amounts to Rs
1000 to Rs 2000, which varies depending upon the quantity purchased. Collecting the money
on the monthly basis helps them to meet the beginning of the month expenses such as rent,
milk, grocery expenses etc.

There seems to be no association or any informal body which brings together the flower
sellers of Choolaimedu. Each seller operates independently and new comers don’t find it very
difficult to set shop as there is no collective opposition from the existing flower sellers.

Making a profit in this business is a gamble, as they deal with perishable goods, which is of
no use at the end of the day. The flowers that are not sold are usually given to a nearby
temple or go to the dustbin.

4. Limitations of the study:

• In this study, only the flower sellers in the Shanmuganar Salai and Choolaimedu high
road were interviewed

• The figures quoted for capital investment and profits made are the ballpark sum that
were told by the flower sellers and the researcher had no way of verifying it

• The same goes for the amount of money that they borrowed from the money lender.
The flower sellers have the habit of constantly taking a new loan as soon as an old one
is paid off and there is no way to know the total amount that they have borrowed

• The flower sellers, being illiterate, were able to throw little light in the name of the
self help group of which they were/are a member. They joined the SHG based on peer
recommendation and in many cases, the group leader being known to them
personally.

A case by case description of the flower sellers are given below.

5. Case studies
5.1. Vasantha:
Vasantha –The flower seller, who doesn’t know how to tie
the flowers, was the first flower seller the researcher
encountered. Born and brought up in Chennai, she was into
a host of other jobs –a house maid, distributing milk packets
etc before settling into the business of flower selling. When
asked about what made her get into the business, she simply

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stated that it was old age. 10 years ago, she started selling flowers as her health started failing
and hence, could no longer do hard physical labour. Getting into this business was a little
easy as her aunt and her nieces are already into this business, which provided her with a
decent exposure to the business of flower selling. With her savings as the capital, she started
this shop.

With 2 handicapped sons, this uneducated lady does her best to support the family to make
the ends meet. One son has a fruit shop nearby and another is an auto driver. With the help of
her sons, who sometimes go and buy flowers from the market and her daughters in law who
distributes flowers to the door steps of the customers, she manages this shop which she has
been running for 10 years.

On a small table that is buckling under the weight of flowers worth Rs 500-1000, she runs the
shop. And as she doesn’t know how to tie the flowers, she outsources it to another lady to
whom she pays Rs 100 per day. Each day, she makes a profit at the range of Rs 100 to Rs
200. This amount notwithstanding, she regularly borrows money from the local money lender
to meet her household expenses. To the money lender, she pays an amount of Rs 50 or 100
per day, depending upon how much money she has borrowed.

When asked about her awareness about MFI, she proudly told the story of how she managed
to get a loan of Rs 10,000 from Mahasemam recently inspite of her being 58 years old. “I
gave them a photo of mine that was taken 8 years ago. In that I look 50 years old and thus
managed to get a loan. If I told them that I am 58, they won’t give me a loan.” She giggles.
Her daughter in law has also got a loan of Rs 10,000 from Mahasemam. For this loan, she has
to make a fortnightly payment of Rs 250 for one year. She came to know about Mahasemam
through her friends. However, she feels that SHGs are not for her as the procedures involved
are not transparent enough for her to understand.

Content with the shop, she has no further plans for expansion or generating more income. All
that worries her now is her 6 year old grandson who has undergone an eye surgery.

5.2 Kannama.S:
Soft spoken uneducated Kannama was
watching curiously when I was speaking
with Vasantha. Kannama and Vasantha
have their shops right next to each other
and they whispered slyly as how the other
person’s business was affecting them. Her
voice is barely audible and her daughter
Kalpana came to my rescue by amplifying
what her mother spoke. The former Vellore
born vegetable vendor had come to
Chennai 40 years back and shifted to
flower selling business 5 years back as she
could no longer lift heavy basket of

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vegetables. The 60 year old Kannama has 4 sons and a daughter. She buys flowers everyday
for Rs 1000 and makes a profit of Rs 100 to Rs 150 per day. Kannama is lucky to have the
support of her daughter in tying flowers and distributing it to customer’s houses. Also, her 4
sons and her husband pitch in to help her buying flowers from the market. Inspite of the help
from her daughter, she outsources flower tying to a third party as she doesn’t know how to tie
flowers.

Totally unaware of MFIs and SHGs, Kannama prefers borrowing money from the money
lender. She gets the loan to meet her other expenses and has no intention of expanding the
shop further to generate more income. “Taking care of a shop of this size by itself keeps me
busy. If I expand, I will only end up making a loss” says Kannama.

It was interesting to note that Kannama is unaware of MFI when her next shop neighbour has
gone to the extent of circumventing Mahasemam’s policy of not lending out money to people
above the age of 50 years.

5.3 Sivabaghyam:
Glib and oozing with confidence,
Sivabaghyam is a woman of substance.
When asked about her education her
answer set the tone for the rest of the
talk –“so what if I didn't have
education? I have talent and that’s all
that counts” came the reply.

This 47 year old Chennai born mother

of two is a born business woman. With
her smooth talks and a knack for
identifying opportunities, she is least handicapped by her illiteracy. Her shop is set opposite
to a small temple in the Shanmuganar Salai. Apart from selling flowers, she also sells other
items that are required for pooja on small scale –coconut, banana, lemon and betel leaves.
She runs the shop at a capital of Rs 500 per day. This may go upto Rs 3000 during festival
times and manages to make profit of Rs 100 –Rs 150 per day. She says that she can manage
the shop with the money she earns by it. And she also proudly points out to beautiful fresh
Bangalore roses which she always keeps stock.

Flower selling comes to her naturally as she has been on and off in this business since she
was 10 years old. This is also the family business of her in laws. Supported by her mother in
law and her husband who ties the flowers, she has a successful business and has managed to
educate her son, who is a BSc computer science graduate. Her daughter studied till 10 th
standard and is now married.

She borrows only for family expenses –weddings, deaths and other occasions. Her experience
with self help group was not all rosy. The 10,000 rupees that she had borrowed from SHG
required her to pay Rs 275 every 15 days and she quit the group once she finished the loan.
“1 year is too long a period for repayment and the meetings that one has to attend is a pain in

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the neck” she says. She is comfortable borrowing money from the local money lenders as she
can finish of the loan within 3 months and avail another soon after.

5.4 Lakshmi:
55 year old uneducated widow with a 25 year
old widowed daughter to support is Lakshmi for
you. Her shop is very small when compared to
the previous 3. A small wooden plank set up at a
street corner is her shop, which she runs at a
capital of Rs 300 per day. For this she earns a
profit of Rs 50 and sometimes, this may go upto
Rs 100 when her capital increases to Rs 500.

Lakshmi was formerly running a small Tiffin

shop nearby but she quit the business when her
knee started troubling her. 1 year ago, she started the flower business with the money that she
had saved and is helped by her daughter who ties the flowers. Lakshmi also outsources flower
tying and pays around Rs 30 per day for the labour.

She manages the shop from the money she earns from it and is supported by her son now and
then. Her daughter gives beauty treatment to women at their home. Lakshmi is wary of
SHGs. She was associated with one and had successfully repaid the Rs 5000 loan that she had
taken. But she decided to opt out when they offered only Rs 7,000 for a Rs 10,000 loan. “The
SHG leader is not trustworthy...they are trying to cheat us” is what she feels.

Half way through the conversation, her daughter Amudha joins us along with her daughter.
She explains that now they have got a loan from Equitas for an amount of 15,000. Lakshmi’s
face beams with pride when she explains that she had used the loan amount to get a cycle for
her granddaughter. Lakshmi is now very strict about not taking any more loans from the local
money lenders as she feels that she can make the ends meet through her business. “You get
used to the money and then you start borrowing more and more. When I was young, I could
cope with the repayment, but now it is no longer wise. After repaying the Rs 15,000, I am
planning to sustain without any further loans and support my daughter in whatever way I
can” says this devoted mother and grandmother.

5.5 K.Rani:

70 year old Rani doesn’t look a day older than 50 and has a
grit in her that enables her to carry on with her life. Deserted
by her 2 sons and a daughter, she now lives all alone and
sleeps in the verandah of a kind hearted house owner.

“My husband died with a loan of Rs 1 lakh 7 years

back...when I managed to finish that, I spent another lakh for

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my son’s wedding for which am still repaying. Inspite of that, they left me all alone now” she
laments.

A native of Dhindivanam, she came to Chennai 29 years back and has been into the flower
business for 12 years. When asked about what made her get into this business, she said that
when people came to buy fruits from her husband’s shop, they would also ask if he had any
flowers. Recognising this customer need, Rani started the flower business despite her
husband’s protests. Before getting into flower business, she was working as a maid.

Her age does not allow her to invest more than Rs 100 or Rs 200 per day for the shop and she
gets a profit of Rs 25 to Rs 50 per day. Very rarely she invests Rs 500 as capital. She is now
afraid of taking any further loans, even from the local money lenders as she feels that at this
age, it will not be easy for her to repay. “I can sustain the shop with what I earn. My needs
are also less and I don’t have to support any one anymore. So what is the need for borrowing
money?” she smiles.

Though she is aware of SHG (which she associates with misappropriation of funds) and
MFIs, she feels that they are not needed for her.

5.6 Uma:
30 year old Uma is a class apart from other flower sellers as she does this business to use her
time productively, while for others, it is a means of livelihood. Her husband, in association
with his father, runs a successful garland business. This paved the way for Uma to start
selling flowers 5 years ago at her own doorstep. Flowers worth Rs 150 to Rs 350 is brought
from Koyambedu from her husband and her 2 children –a son and daughter who are studying
in 6th and 1st standard respectively helps her in delivering the flowers to the homes of her
customers. Though she is uneducated, she is determined to provide a good education for her
children.

With a profit of around Rs 100 per day and sufficient income earned by her husband, she
finds no need to borrow money from outsiders. However, she has borrowed Rs 3000 and Rs
2000 from her close friends who have started money lending business. “I got the money as
they have started this business very recently. I have borrowed money just to support them”
she says.

When asked about SHG, she says that it is not for her as attending to their meetings always
throws a wrench in her schedule. With no plans of expanding the business, she says MFI is
not her cup of tea.

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5.7 Sakkarai:
Into the flower business for the past 20 years,
Sakkarai is a proud mother of 2 sons, one of
whom has studied polytechnic and another is
into the flower business. 45 year old Sakkarai is
a Dindukal native and flower business is their
family business. Her late husband was also in
this business.

She started her business with a capital of Rs

100, which she had borrowed from the money
lender and now she invests anywhere between
Rs 250 to Rs 500 per day for her business, out
of which she makes a profit of Rs 100 to Rs 150
per day.

She is unaware of the concept of micro finance and regularly borrows money from the money
lender and this sum ranges from Rs 1000 to Rs 3000, depending upon the needs. She utilises
this money to meet her household expenses and for paying her son’s education loan. For the
past 7 months, she is a part of a self help group and is raring to get done with it as she finds it
difficult to make the monthly payments and attend to the meetings.

She says that she is comfortably running her business with the money that it generates. Her
sons are her pillars of support and she is keenly looking forward for retirement from the
business.

5.8 Veeramma.M
True to her name, Veeramma had
courageously battled it out with other
nearby flower sellers to set up her own
small flower shop in the Choolaimedu
high road. The uneducated 30 year old
Dindukal native came to the city of
Chennai 3 years back and started the
flower selling business 6 months ago.

Errant husband who no longer contributes

to the family income made her take up
this job. Tying flowers since the age of 10
and her husband being in the flower
business made choose the business of flower selling to boost her income.

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She started out as a house maid and with a generous help from her employer, she started this
business with a capital of Rs 100. Now she invests around Rs 200 per day and manages to
make a profit of Rs 90. Her daughter, who is now studying 3 rd standard is what keeps her
going on. Having lost four sons earlier in childbirth, her daughter is the centre around which
her life revolves.

She supplements the income from flower shop by working as a maid. Back at her native
place, she was a member of a SHG but was not happy with it as she felt that she was being
cheated. The experience now has her shunning away from joining any SHG as she says that
she cannot afford the monthly payments, nor can she go for the meetings.

“Borrowing money from the local money lender works fine for me as the repayment
instalments is as small as Rs 20 per day for the Rs 2000 loan that I have taken. Also, I can
close the loan in a short duration as against the 1 year period it takes in SHG.” She says. The
amount that she borrows mainly goes for meeting her household expenses. She is not aware
about MFIs.

Her little daughter helps her in the business by delivering flowers to homes. Veeramma
expressed that all she is looking forward is to give her daughter a decent education and that is
all that matters to her right now.

5.9 Indira:
A widowed woman with a child to support and supported by her sisters is Indira for you.
Come from a family that has been in the flower selling business for more than 3 generations,
she, along with her 2 sisters, mother and nieces and nephews runs this flower shop at
Choolaimedu high road.

Answers for my queries flew left right and centre from the 3 sisters and a niece. Between the
3, they run a flower shop, a tender coconut shop, sells vegetables. This big joint family have
their shop in the same premises for the past 40 years.

They invest an amount of Rs 1000 per day for their flower shop and earn a profit of Rs 200
per day. Uneducated native Chennaiites, Indira and her sisters regularly borrow money in the
range of Rs 5000 to 10,000 from the local money lender to meet their household expenses.
They sustain the shops from the income that it generates. Recently they have become a
member of Mahasemam and have obtained a loan of Rs 10,000 a few weeks back.

The closely knit family system and the comradeship between the sisters ease the financial
burden on the family.

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5.10 Anjalai:
55 year old Anjalai started selling lowers since she was 15
years of age and has been running the flower shop in the
same premises for the past 40 years. Mother of 4 sons and 2
daughters, none of her children has completed schooling and
her sons are working as contract labours.

Anjalai, who is uneducated, is a native of Chennai. Her small

flower shop runs at a capital of Rs 200 to Rs 250. She makes
a profit of Rs 50 per day. Her husband helps her financially in
the business and she resorts for borrowing money from the
money lenders to meet her household expenses.

Anjalai like many others is not keen about SHG as she feels
that she cannot gel well with other women. The regular meetings that one has to attend if they
are a member of SHG also keep her away from such programs.

Ignorant about the concept of MFI, she showed les enthusiasm to it even when explained as
she felt that group dynamics with her peers in the area is not her cup of tea. “Getting money
from the money lenders is easy to keep track of and is less of strain on the purse” she says.

Anjalai has plans of selling bananas and coconuts in her shop in the future and is working on
how to generate the capital required for it.

5.11 Gowri:
Gowri is a 52 year old diabetic patient who laments that most of her income goes for her
medication. Her late husband was a rich man who had acres of land in Vizhupuram, but the
family came to poverty as the husband became an alcoholic and squandered away the wealth.

The mother of 5 daughters and a son, Gowri never did any work previously and lived in her
son’s support. 10 years ago, she took up the business of selling flowers with the help of her
daughters who are flower sellers. She started the business with an investment of Rs 50, which
has now increased to Rs 200 per day. She makes a profit of Rs 50 to Rs 100 and gives this
money to support her son’s business and her grandson’s education. She delivers flowers to
the home of her customers. Her son helps her in the business by buying flowers for her from
Koyambedu and apart from that, she has no one else to help her in the business. Every 3
months, as and when she repays a loan, she borrows another amount from the money lender
to meet her household expenses and for supporting her son’s business.

She was a member of Mahasemam and opted out of it as she felt that there was a
misappropriation of funds. So now, she depends solely on the money lenders.

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5.12 Aarumugam Ammal:

When asked for her name, her husband rushed
forward and said “Aarumugam Ammal” with a
heavy stress on “Ammal”. The husband and
wife duo hail from a family of flower sellers
from Kariampatti –a small village near
Dindukal. She was also the only flower seller I
had encountered to have had some education.
She has studied till 8th class. 34 year old
Aarumugam Ammal is striving to make ends
meet and also support the education of her son,
who is now in 11th standard and daughter who is
in 9th.

“We started this business because we fell into

bad times and badly needed additional income.”
Says Murugan, her husband, who sometimes
helps her in running the shop. He works in a
flower shop in Parrys and they buy the flowers
for the shop from Parrys. Into this business for the past 10 years, Aarumugam Ammal sets
shop for a capital of Rs 500 and makes a profit of Rs 100 to 15 per day. Once, she was a
member of SHG but unfortunately, the group has dissolved and now, she is looking forward
to join another SHG, mainly for saving money rather than availing loan. “We borrow money
from the money lender only during festival times to infuse more capital to the shop.
Otherwise, with the money that we earn between us, we can manage our expenses” beams
Aarumugam Ammal. The couple feel that it is best to avoid borrowing as it becomes an
unnecessary strain on their pockets. “It is best to limit our expenses in accordance with the
income” says Murugan.

Incidentally, it was Murugan who changed her wife’s name to “Aarumugam Ammal” from
“Aarumugam”. “It’s a man’s name... I wonder how her father gave her such a name” he
grumbles good naturedly, while Aarumugam Ammal smiles shyly.

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5.13 Vasantha:
45 year old Vasantha has her shop right next to the
Choolaimedu bus stop and has been doing business in the
same area for almost 30 years. A native of Bunroti,
Vasantha inherited this shop from her neighbour from
Bunroti, who was moving to another area. Ever since, she
has been running this shop and currently invests Rs 300 to
Rs 400 per day as a capital, making a profit of Rs 100 per
day.

Vasantha had to repay a loan that was taken by an

acquaintance in her name from a finance company nearby –
Amma Finance in the Choolaimedu high road. “They
absconded with the money...I had to pay back for the Rs
10,000 loan” she laments.

Vasantha’s livelihood and business revolves around the money she continually borrows from
the local money lenders. “It is no strain. I have to make a daily payment of Rs 10 to Rs 50,
depending upon the amount I borrowed. And once I finish of the loan in 3 months, I avail
another” she grins.

When asked about SHG and MFI, she was able to say that she was a part of both but was not
able to explain the details of it. When pressed further, she took me to the centre leader of
Equitas, from whom she has borrowed Rs 10,000.

“I don’t believe in these SHG and MFI. I end up paying more. Never again am going to
borrow money from these people. Money lenders are the best choice” she says with
conviction and nothing could shake her conviction, even the calculations that I made for her.

With only one son, who is uneducated like his mother, Vasantha avails his help and her
mother’s for the business. “I am planning to build a home at my native. Once that is done, I
will retire...Have had enough of this business” says Vasantha.

5.14 Kuppamma:
A huge red bindhi, lips that are stained maroon with constant
chewing of betel leaves and an attitude that is aimed at milking
sympathy –this is Kuppamma in a nutshell. This 65 year old lady
supplements her income by working as a night watch woman in
one of the flats nearby, though which she earns Rs 2000 per month.

15 years ago, she got into the business of flower selling, before
which she worked as a maid. Old age made her quit the previous
profession and turn to the less labour intensive job of selling
flowers. Skirting around the topic of her family, this Chennai native

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talks about the days when she started the business with a 50 rupee capital. Now she invests
anywhere between Rs 1000 to Rs 2000 per day for her shop. From this, she makes a profit of
Rs 250 to Rs 300. Kuppamma has availed a loan of Rs 10,000 from Amma Finance in
Choolaimedu and is looking forward to finish off the loan in the next 3 months. not a big fan
of money lenders or SHG, she says that borrowing money from neighbours and other known
persons is the smart way to supplement the income as she can repay the borrowed amount
without interest within a couple of days.

5.15 Shanthi:

Fiercely independent and self sufficient,

Shanthi literally snarled out when I asked
who helps her in running the shop. “I
don’t need anybody’s help for this.
Neither will I ever go and ask somebody
to lend me a hand” says Shanthi. 48 year
old Shanthi has been running this
business for 28 years. Mother of 2 sons
and a daughter, this uneducated woman
has given her children the basic
schooling. The capital for her shop comes
mainly through the money that she borrows from the money lenders. Shanthi is also a part of
a SHG, where she has successfully completed the repayment of a loan of Rs 10,000 and has
now taken a loan of Rs 15,000 from them. She repays this loan through monthly instalments
while for the money lenders, it is through daily instalments. She, however, is not aware of
MFIs.

She sets up the shop with a capital of Rs 500 to Rs 1000 and outsources a part of the flower
tying at a payment of Rs 20 per day for labour. The shop gives her a profit of Rs 100 and she
is quite content with what she has now, with no further plans of expansion.

5.16 Lakshmi:
75 year old Lakshmi is a very intriguing
character. Estranged from her sons and her
husband, she has been living alone for the
past 35 years. Coming from a family of
flower sellers, she buys flowers from her
husband’s shop at Koyambedu. “It is
purely business. I pay him promptly...I
don’t expect or want his help” says
Lakshmi. She has been into this business
for the past 40 years. She invests Rs 700
per day for the shop and makes a profit of
Rs 50 to Rs 100 per day which though which she sustains her life. A member of a SHG at

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Aminjikarai, Lakshmi is not eligible for taking loans, but she uses the SHG to save Rs 110
per month.

“I stay alone and there is no one to look after me. So the only option available for meet my
financial needs are the local money lenders. I regularly borrow Rs 10,000 from them and
repay it at the rate of Rs 100 per day and finish of the loan in 3 months, after which I again go
for a loan. It is through this money that I sustain my business and my livelihood” says this
lonely grandmother.

5.17 Leelavathy:
With her hair tightly bound into a bun and
stern specs perching on her nose, Leelavathy
looks like your regular government school
miss. But this 45 year old 3rd generation
flower seller proudly announces that she will
be the last in her family to sell flowers.
Leelavathy has been running the shop for the
past 30 years and is proud of the fact that her
only son has studied B.Com. “He got a merit
seat at the Pachaiyappa’s College and we
didn't have to get even single paise as loan
for his studies” she beams with pride. The
son now works with TTK Pharma.

Leelavathy who is a member of a SHG is

waiting to get out of it as she feels that the
group leader misinformed her about the terms of the loan. She saves Rs 110 per month in the
SHG and is waiting for the 3 year period to get over so that she can come out of it. Once, she
got a loan worth Rs 3500 from the SHG and she says “enough is enough. I have repaid the
loan and once my 3 year locking period for my savings gets over, I will get out of SHG.” She
sets her shop with a daily investment of Rs 400 and earns a profit of Rs 100 per day. To meet
her day to day expenses and to supplement the capital for her shop, she prefers the local
money lender from whom she regularly borrows Rs 5000 and repays it in 3 months through a
50 rupee daily instalment.

5.18 Tamizhchelvi:
32 year old Tamizhchelvi started selling flowers 3 years ago
when her husband deserted her. With a son and a daughter,
uneducated Tamizhchelvi says that all that she wants now is
to see to the fact that her children get good education. She
started the business with a capital of Rs 200, which she
invested out of her savings. And now, the shop has expanded
and she invests Rs 500 to Rs 900 per day, making a tidy profit
of Rs 150 to Rs 200. Incidentally, the business that provides
her with livelihood is the family business of her in laws.

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“I never borrow money. What I earn from the shop is sufficient to meet my needs” she says.
When I looked at her in astonishments, she smiles and says that her mother and her brothers
support her by giving provisions and some money for urgent needs. “It was them (her mother
and brothers) who married me to the man who deserted me. So it is their responsibility to take
care of me” says this Madurai native.

With this support, she says that there is no need for her to borrow money. Tamizhchelvi si a
member in a SHG in which she saves Rs 110 per month. “I got a loan from the SHG and
transferred it to someone else” she grins. With her son and daughter supporting her in the
business by delivering flowers to the houses of customers, Tamizhchelvi is happy with the
way her business is flourishing. “I am planning to expand my business soon by getting more
varieties of flowers” she signs of confidently.

5.19 Panjaksharam:
You ask her about her age, it comes with a disclaimer. “Am only 56 years old, but my hair
has gone white prematurely” says
Panjaksharam, who has been selling flowers
since she was 10 years old. She fondly
recollects the days when she sold flowers with
her father at the bus stop in Parrys. “Selling
flowers is the only thing I know. It is in my
blood” she says.

This woman of grit has been through the death

of 2 sons and her husband. “After my husband
died 2 years ago, I stopped taking loans from
the money lender. It is better to get money
from the neighbours and repay within a few
days free of interest” says Panjaksharam. With
this flower business, she contributes to the
running of the family of her two remaining
sons and is helped in her business by her sons
and sharp 10 year old grandson who ended up asking me more questions than I asked to his
boisterous grandmother.

Her shop is one of the oldest in Choolaimedu, which she set up way back in 1968. Her
regular customers include the Amma Hospital, Aruna Diabetic centre and a couple of other
clinics nearby. She invests Rs 500 to Rs 900 per day and earns a profit ranging between Rs
100 to 150. Panjaksharam, who is not a big fan of SHG or MFI, says that she is content with
what she has and is keenly exploring various avenues of savings.

5.20 Kannatha:
Kannatha was the last flower seller I interacted with and her shop was also the smallest that I
encountered. 60 year old Kannatha is a resigned woman who has no one to support or look

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after. Into this business for 35 years, Kannatha had a flourishing business in Parrys. She
shifted to Choolaimedu 5 years back, after her husband died. They never had any children.

“In those days, I used to invest Rs 500 to Rs 1000 per day in the shop which both I and my
husband tended. But now, I just put in enough capital (Rs 100 to Rs 150 per day) to meet my
daily needs.” She says. With the profit of Rs 30 to Rs 50 she makes, she meets her expenses
and pulls though the day. When asked how she can support herself on such a meagre income,
she smiles and says that she has money left from the jewels that she sold off, which she has
saved for a rainy day.

Kannatha doesn’t borrow any money from the lenders and is not the least bit interested in
SHG of MFI. “I am just counting the days for God to call me from this world” says Kannatha
with a sorrowful smile.

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6. Business model of flower sellers:

Given below is the graphical representation of the business model of the flower sellers.

Fig 1: Business model generation canvas

7. Other insights and inputs:

7.1 Vishwanathan:
Every day, Vishwanathan, the money collector makes rounds on his scooty to collect money
from those who have borrowed from the money lender. His customers have a wide flexibility
on the loan amount, which ranges anywhere between Rs 100 to Rs 10,000 and also on
repayment terms. Borrowers can repay the money on a weekly or daily basis. However, the
repayment period never exceeds 3 months.

Vishwanathan has 15 colleagues who go around distributing and collecting money every day.
He says that over the years the business has been steadily increasing and laughs out when

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questioned whether MFIs are their competitors. “They can never be our competitors. Can
they lend a sum as small as Rs 100?” he asks.

Vishwanathan has been in this business for the past 20 years and he says that his customers
always promptly repay the money.

When questioned further on turnover and other details, Vishwanathan refused to divulge any
information and sped away in his scooty.

7.2 Rebecca:
Rebecca is a dynamic entrepreneur who is into detergent sales. She is the centre leader of a
group of 25 women of Equitas Microfinance and the group leader of the self help group,
Swarnammal Arakattalai promoted by M.K.Stalin.

Her group has opted for the joint liability model for the MFI loan. They are in the last leg of
repayment of the Rs 10,000 per person loan from Equitas and will soon be eligible for a loan
of Rs 15,000. When asked about the enthusiasm shown by the members for the MFI, Rebecca
was sceptical. “After this, maybe just 10 to 12 of the group members will be willing to take
up the next loan” she said. When asked for the reason, she said “they find it difficult to repay
the money on a fortnightly basis as the sum gets accumulated as against what they pay to the
money lenders on a daily basis. Being a joint liability model, even if one defaults, the others
have to share the burden, which is quite difficult for us.”

However, she was much more enthusiastic about the SHG and said that it has been a huge
success and the members are looking forward to avail the next loan.

When asked about how the group members utilize the money obtained as loan, Rebecca was
non committal and said that it may be used for both business as well as personal expenses.

7.3 Matt Duncan:

Matt Duncan is associated with the Grameen Foundation and is based in Seattle, USA. The
researcher chanced upon meeting Mr Duncan at the Coffee Day Square in Bangalore while he
was discussing technical aspects of micro finance with an associate.

Duncan has come to India to conduct a seminar on technology for microfinance which is to
be held in Delhi. The researcher discussed about some aspects of micro finance with Duncan
and he patiently shared his expertise. Given below are his insights and observations.

“There are only 10 major micro finance companies catering to the entire world!” he started.
“MFIs need to focus on moving out and reaching out to more people rather than moving up
and making more money. The need of the hour is that MFIs must go back to the basics and
remember that they were started with a social objective in mind and must adhere to it, instead
of letting the focus drift more towards profit making.”

When asked about the impact of micro finance in the lives of people, Duncan had many
success stories to share. However, when asked specifically about the role of MFI in the lives

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of urban population, he stressed again on the stand adopted by some MFIs who restrict
themselves to urban areas and how it may not really make a difference.

Duncan, along with his associates, has developed a new cloud technology which can be used
by MFIs at lower costs to enhance their performance and efficiency and at the same time, cut
down their cost. “If an MFI can reach the rural population at the same cost that it can reach
the urban population, then what is there to stop them from extending their hands to the
needy?” says Duncan.

8. Money matters:
While the business cycle and the money management of the 20 flower sellers have already
been discussed in the report, given below is an overview of the operating monetary metrics
for everyday business day for these flower sellers. Also, a small comparison has been made
between the interest levied by the money lenders and the MFIs and respective loan terms. The
perceived merits and demerits of the credit sources by the flower sellers are also touched
upon. The figures as presented in this section have been arrived at by averaging the outcomes
of the survey.

8.1.1 A simple income statement of the flower sellers:

Parameter Percentage

Sales turnover per day 100%

Cost of setting shop per day as a % of sales 73.45%

Profit earned per day as a % of sales 26.55%

Loan repayment expense as a % of profit 51.22%

Other daily expenses as a % of profit 48.78%

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Given below is an example*

Parameter Percentage Example

Sales turnover per day 100 500

Cost of setting shop per day

as a % of sales 73.45 367

Profit earned per day as a %

of sales 26.55 132

Loan repayment expense as a

% of profit 51.22 68

Other daily expenses as a %

of profit 48.78 64

* The figures presented have been arrived at based on the results of the survey pertaining to
the investment, daily turnover, and loan repayment, up to the date of the survey.

8.1.2 Money lenders Vs MFI

Given below is a comparison of the loan terms from the different sources. Comparison of
simple interest has been adopted for reasons of convenience.

Parameters MFI Money lender

Payout to customer as a % of
total loan amount 100% 85%

Amount withheld as a % of
total loan amount 0% 15%

Simple interest on the loan 16.34% 64.41%

Loan period 2 years 100 days

Frequency of repayment Once in 15 days Daily/weekly repayment

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Customers’ perception of borrowing from money lenders:

1. Daily repayment is perceived as an advantageous option since the business thrives on daily
cashflows, and the burden of repayment is viewed as minimal.

2. Short duration of loan facilitates frequent borrowing, which is seen as apt for the business.

3. Transactions (lending and repayment) happen at borrower's doorstep, which is seen as a

convenience.

4. The flower sellers feel that the interest rates charged by MFI are higher inspite of proving
to them through simple calculations that it is the other way round. This is mainly because,
when borrowing from the money lender, the repayment is made in small amounts, which
makes them believe so. Lack of knowledge and ease of procurement of loan are also viewed
as distinguishing factors.

Customers’ perception of borrowing from MFI

There a lack of awareness about MFI among the flower sellers who were interviewed. Those
who have borrowed money from the MFI have the following to say

1. Difficulty in attending to group meetings

2. Making bulk payment (ie around 250-300 rupees) every fortnight is difficult as the money
needs to be mobilised before hand

3. Long loan duration makes it difficult to borrow more frequently. The florwer sellers prefer
a lesser turnover period.

9. Observations:
By studying this small sample of 20 flower sellers in Choolaimedu, some of the thoughts and
questions that come into the mind are discussed below.

9.1 Demographic aspects:

1. The average age of the women who are into this business is 50 years, with the
youngest being 30 years of age and the oldest 75 years

2. 50% of the women come from a family of flower sellers and hence, taking up this
trade has been a natural step for them

3. Of the remaining 50%, the business of flower selling was an option that they took
because it was less labour intensive and hence, could easily be managed inspite of
their advanced age.

4. 60% of the flower sellers are Chennai natives and the rest have settled in this city for
more than 10 years

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5. 19 of the 20 flower sellers are uneducated.

6. Their children are also not highly educated. Most of them are school dropouts with
exception of 2 cases where the children have finished under graduation

7. 45% of the flower sellers are widowed and for the remaining, the husbands are into
either flower business or work as labourers.

Points to ponder:

Many of the flower sellers, despite their age, continue to support their family by generating
income through this business. These women exhibit extraordinary grit when it comes to
seeing the welfare of their children and grandchildren.

More than a means of livelihood, this business is also a means through which they support
the livelihood of their grown up sons and their sons.

9.2 Business aspect:

1. The average capital employed by the flower sellers is around Rs 500 per day and on
an average, they make a profit of Rs 100 per day

2. The flower sellers do not have a fixed supplier from whom they buy flowers every
day

3. The common flowers that they sell are jasmine, jaadhi or mullai depending upon the
season, saamandhi, kadhambam (which is a mix of jasmine, kanakambaram,
marikozhundu). Hybrid rose is also sold.

4. Neither do they have a predetermined product mix. They vary the quantity of flowers
depending upon the price of each variety.

5. The flower sellers do not seem to have a large number of regular customers.

6. They sell flowers primarily from the same location. Once they set up a shop, they do
not move that particular place.

7. Home delivery of flowers is done to select customers from whom they collect money
from a monthly basis.

Points to ponder:

Considering the nature of this business which requires infusion of capital on a day to day
basis, how can MFIs or SHG help these flower sellers with the lump sum that they give out as
loans? Can there be any way through which women such as these can be reached out and
helped by the MFI?

The local money lenders seem to be the perfect alley for these women as they lend amount as
small as Rs 100 which will help the women to set up the shop. They find frequent borrowing
more suited for their style of business and these money lenders cater exactly to this need.

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9.3 Financial aspect:

1. 17 of the 20 women go to the money lender for their requirements and find it
convenient to repay to the lender on a daily or a weekly basis

2. Short repayment period, flexibility over instalment amount, minimum loan amount,
individual liability and frequency of repayment period make the option of borrowing
money from the money lender attractive

3. Another added advantage with the money lender is that the money is lent and
collected at their doorstep.

4. As the repayment period is short, the flower sellers are able to avail new loans once
every 3 months, which is not the case with SHG or MFI, where the repayment period
is as long as 1 year.

5. Trustworthiness of SHG is a major concern among the flower sellers as those who
have been a member have had bad experience and feel cheated by the group leader.

6. They also find attending to the meetings and liaising with peers of SHG as
inconvenience

7. Only 3 out of the 20 women are aware of MFI.

8. The flower sellers feel that the procedures involved in availing loan from SHG or MFI
complicated. This is another factor which makes them go for the money lender

9. The flower sellers feel that repaying money on a daily or weekly basis is easy on their
pocket and does not put much strain on their resources. However, when an
accumulated amount is paid fortnightly or on a monthly basis, they feel the pinch.

10. The purpose of borrowing in majority of the cases is for meeting personal expenses
rather than for business needs.

Points to ponder:

The question that arises is that, if these women, who borrow primarily to meet their personal
expenses, continue to do the same without a thought of generating more revenue, than how
can MFI or SHG help in improving their standard of living? Will they really make a
difference in the lives of these urban flower sellers who already run an established business?
Is there a way to help these women out of the vicious cycle of borrowing and repaying and
borrowing again?

Also, it is glaringly visible that these money lenders make the lives of the flower sellers
easier. They give them capital for setting up the shop everyday and what they collect at the
end of the day is a small percentage of the profit that these women earn by selling flowers.
Looking at the money lenders in this perspective, we see that they are nothing but very small
scale venture capitalists. Contrary to the popular belief, these money lenders cannot be

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deemed as villains or ruffians in a broad sweep, but they can be looked up as “street venture
capitalists.”

10. Scope for further study

This report is a small step towards understanding the needs of urban women, who are
engaged in a business that requires daily infusion of capital.

The study can be further developed by covering different industries like the vegetable sellers,
fruit sellers, fish sellers etc, for whom the credit needs are different from women who enter
into a business that does not require daily capital infusion –like handicrafts sellers, farmers
etc.

Also, the further studies can be made in the direction of finding out the relation between
various aspects of the business like –profits earned per day, loan taken, sales etc statistically.

By doing so, a path can be paved for meeting the credit requirements of these women, who
still largely depend on the money lenders.

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Appendix 1:

Fig 2: Map showing the area covered –Shanmuganar Salai and Choolaimedu high road

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Appendix 2:
Questions:

The questions that were asked are

1. Demographic

a. Name

b. Age

c. Educational qualification

d. Native place

e. Number of members in the family and their educational qualification

f. Family business

2. Business

a. Number of years for which they are into this business

b. Support received for the business from family and through outsourcing

c. Various aspects of the business

d. Time for which they sell the flowers

e. Sourcing of raw materials

f. The inspiration behind starting the business

g. Future plans of the business

3. Financials

a. Capital employed per day for the business

b. Profit earned per day

c. Source from which they borrow the money

d. Interest rates of the money borrowed

e. Frequency of money borrowed and the purpose of borrowing

f. Repayment details

4. Awareness level

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a. Awareness about self help groups (SHG) and micro finance institutions (MFI)

b. Details regarding their own participation in SHG and MFI

c. Their views about SHG and MFI

d. Preferences regarding sources of borrowing and the reason for the chosen
source

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